To treat Washington's spending addiction, the November elections are the taxpayer's best chance to stage an intervention. But until then, President Obama and the Democratic Congress are determined to keep pushing strung-out state governments to take one more fix.
Witness yesterday's 247-161 largely party-line House vote to approve a Senate bill shovelling another $26.1 billion out to state education and Medicaid programs. The White House has promoted the bill as emergency assistance for strained state budgets. But this unique brand of therapy drives states to spend more, not less. The "assistance" is so expensive that several governors were begging for relief even before Mr. Obama signed it into law.
Standing with teachers yesterday in the White House Rose Garden, Mr. Obama said, "We can't stand by and do nothing while pink slips are given to the men and women who educate our children or keep our communities safe." Maintaining the salaries and generous benefit plans for members of teachers unions is indeed a top Democratic priority. That's why $10 billion of the bill's funding is allocated to education, and the money comes with strings that will multiply the benefits for this core Obama constituency.
Specifically, the bill stipulates that federal funds must supplement, not replace, state spending on education. Also, in each state, next year's spending on elementary and secondary education as a percentage of total state revenues must be equal to or greater than the previous year's level.
Governor Haley Barbour of Mississippi did the math and figured out his state will be worse off. Mr. Barbour says the bill will force his state "to rewrite its current year [fiscal 2011] budget. Preliminary estimates of the Mississippi Department of Finance and Administration show that we will now have to spend between $50-100 million of state funds—funds that must be taken away from public safety, human services, mental health and other state priorities and given to education—in order for an additional $98 million of federal funds to be granted to education. There is no justification for the federal government hijacking state budgets, but that is exactly what Congress has done."
Showing posts with label state bailouts. Show all posts
Showing posts with label state bailouts. Show all posts
Wednesday, August 11, 2010
Tuesday, August 10, 2010
Democrats robbing the poor to bail out free-spending schools
Democrats on Capitol Hill are literally taking food out of the mouths of the most needy to pay back their political cronies. Today, the House will vote on the infamous Bill with No Name, H.R. 1586 (originally the FAA Air Transportation Modernization and Safety Improvement Act), which contains a $26.1 billion bailout for financially strapped state governments. Much of the money will go to public employee unions, in the form of a $10 billion "Education Jobs Fund" to supplement state education costs. This comes on top of a $53.5 billion bailout of unionized teachers in the State Fiscal Stabilization Fund -- some of which is still unspent. Worse, the new legislation would impose $9.7 billion in permanent tax increases.
The failing economy is not the only reason school districts are seeing shortfalls. The Wall Street Journal reports that school district spending has been out of control for at least a decade and is far out of sync with enrollment growth. As the Journal notes, "total education spending grew by 32% percent between 1999 and 2009, while K-12 enrollment has grown by less that 1% each year over the same time period."
In some cases, unions have prevented state and local governments from making needed cuts in their budgets. For example, earlier this year the Milwaukee School Board announced that it was laying off 428 teachers due to budget shortfalls. The average Milwaukee teacher receives only $56,000 per year in salary, but also gets a generous $40,000 in benefits, including a health care plan that costs $26,000 per family, compared to $14,500 for private employees. The school board sought to cut costs and to keep the teachers by implementing cuts in benefits. A proposed health care plan would have instituted co-pays expected to yield $47.2 million in savings, more than enough to save every teacher's job. The union refused to bargain, instead opting for layoffs.
The failing economy is not the only reason school districts are seeing shortfalls. The Wall Street Journal reports that school district spending has been out of control for at least a decade and is far out of sync with enrollment growth. As the Journal notes, "total education spending grew by 32% percent between 1999 and 2009, while K-12 enrollment has grown by less that 1% each year over the same time period."
In some cases, unions have prevented state and local governments from making needed cuts in their budgets. For example, earlier this year the Milwaukee School Board announced that it was laying off 428 teachers due to budget shortfalls. The average Milwaukee teacher receives only $56,000 per year in salary, but also gets a generous $40,000 in benefits, including a health care plan that costs $26,000 per family, compared to $14,500 for private employees. The school board sought to cut costs and to keep the teachers by implementing cuts in benefits. A proposed health care plan would have instituted co-pays expected to yield $47.2 million in savings, more than enough to save every teacher's job. The union refused to bargain, instead opting for layoffs.
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